top of page
  • Writer's pictureEd DiMarco MS, MA

Understanding Lawsuits Against Property Sellers: Common Mistakes and Preventive Measures

Buying or selling a property is a significant financial decision that often involves emotions, investments, and, unfortunately, potential pitfalls. While a majority of real estate transactions go smoothly, there are instances where disputes arise, culminating in lawsuits against sellers. This article delves into the most frequent reasons property sellers face litigation, the mistakes they often make, and essential tips to sidestep these potential legal quagmires.


 1. Non-Disclosure of Known Defects

The Mistake: One of the most common lawsuits stems from a seller's failure to disclose known defects about the property, whether structural, related to pest infestations, or other material issues.

How to Avoid: Always be transparent. Sellers should comprehensively list any known issues with the property on disclosure forms. It's not only ethical but can also protect against future legal actions.--


 2. Misrepresentation of Property Details

The Mistake: Misrepresenting or exaggerating the features of a property – be it the size, amenities, age, or any other aspect – can lead to disputes.

How to Avoid: Accuracy is vital. Ensure that all property listings, verbal communications, and written agreements correctly represent the property's current state.


 3. Ambiguous or Unclear Contract Terms

The Mistake: Vaguely written contracts or ambiguous terms can lead to misinterpretations and disputes between buyers and sellers.

How to Avoid: Work with a seasoned real estate attorney to draft or review all contracts, ensure that terms are specific, and leave no room for misunderstandings.--


 4. Disputes Over Property Boundaries

The Mistake: Disagreements often arise when unclear property lines lead to encroachment claims or land ownership disputes.

How to Avoid: Always have an up-to-date land survey before listing the property. Marking boundaries can prevent future conflicts.---


 5. Issues with Title or Ownership

The Mistake: Disputes can arise if there are unknown liens, disputes, or undisclosed co-owners related to the property's title.

How to Avoid: Before selling, obtain a title search to ensure no hidden issues or encumbrances could affect the transfer of ownership.


 6. Failing to Meet Contractual Obligations

The Mistake: Once an agreement is made, failing to meet deadlines or other stipulated contract terms can lead to breach of contract claims.

How to Avoid: Familiarize yourself with all contractual obligations and ensure all are met promptly. If issues arise, communicate with the buyer and consider renegotiations if necessary.


 7. Ignoring Contingencies

The Mistake: Many real estate contracts have contingencies – clauses that must be fulfilled for the transaction to proceed. Ignoring or overlooking them can lead to disputes.

How to Avoid: Understand all contingencies in the contract and work diligently to address them within the specified timeframe.


 8. Environmental Issues or Liabilities

The Mistake: If a property has undisclosed environmental hazards like asbestos, mold, or lead, it can lead to litigation.

How to Avoid: Conduct thorough environmental inspections and disclose any known hazards. If issues are found, address them appropriately before selling.


 9. Transfer of Incomplete or Incorrect Property Documents

The Mistake: Submitting outdated, incomplete, or incorrect property-related documents to the buyer can complicate the sale process.

How to Avoid: Ensure all documentation related to the property is accurate and up-to-date, from land permits to renovation licenses.


Conclusion

While property sales can be complex, understanding the potential pitfalls and adopting a proactive approach can substantially reduce the risk of lawsuits. Being transparent, engaging in open communication, and consulting with real estate professionals can help sellers navigate the intricacies of the property market with confidence and integrity.

Some other potential reasons for property disputes that may lead to litigation include:


- Breach of contract claims due to non-payment or failure to meet deadlines.

- Zoning disputes related to the property's intended use or restrictions.

- Disputes related to the property's condition at the time of sale, such as hidden defects or undisclosed damage.

- Title defects, such as liens, judgments, or other encumbrances, affect ownership.

- Disagreements over the terms of the sale, such as price, financing, or other aspects of the transaction.

bottom of page